ALL-RED LINE.

Auckland Star, Volume LXIX, Issue 101, 2 May 1938, Page 9

ALL-RED LINE.

AGREEMENT NEAR.

BELIEF IN CANADA. ANNOUNCEMENT AWAITED. (Prom Our Own Correspondent.) MONTREAL, March 23. Although an announcement is not ready and when made will likely be made simultaneously by all the Governments concerned, information here confirms a London report that the Pacific all-red line agreement is near. The British, Canadian, Australian and -New Zealand Governmente would all contribute by subsidies to the Canadiani'acific enterprise for the construction of the two big liners. There have been some discussions here ae to the way of going about guaranteeing a long-time subsidy in place of ite being voted annually. This, it is stated, is nearly adjusted now. The project has been under Imperial negotiation for fully a year, and Ottawa appears to entertain no doubt of it.

The subsidy mentioned is that proposed for the Canadian Australasian Line which connects Australia, New Zealand, Fiji and Vancouver by means of a two-ship service. Fairly Low Cost. The two new liners which will have to be built in order to put this line on a basis of real competition with the Matson Line, operating from San Francisco, are expected to cost £2,000,000 each, a price, considered fairly low in view of the war vessel orders congesting British shipyards. Both the" C.P.R. and the P. and O. have been campaigning for the past two years to obtain subsidies from Great Britain, and from the three Dominions concerned, in order to provide a service competitive to that of the Matson Line. The latter, a United States owned organisation, has extremely heavy mail contracts with the United States Government, these forming, in effect, a very large subsidy. In addition, the American line ie favoured by the fact that United States coastal traffic regulations forbid the British ships to carry passengers from Hawaii to the. United States mainland, one of the richest parts of the transpacific run.